The morning news. [volume] (Savannah, Ga.) 1887-1900, 1887-09-03

THE B. AND o. PASSES INTO THE
HANDS OF A SYNDICATE.

Well Known Bankers of London, New
York and Philadelphia Get the Prop
erty-The Telegraph System to Pass
Into the Control of the Western
Union.
New YORK, Sept Ever since Mr.,
Garrett wrote his letter TO Mr.. SinSerly,
editor Of the Record, of Philadelphia, break
ing off the Ives negotiations, he has been
working to sell his Baltimore and Ohio road.
Negotiations were continued by him with
j. S, Morgan on his arrival in London, and
to-day an arrangement was announced that
is only equalled by that of the
West Shore settlement with the
New York Central and the forming of the
Reading syndicate to reorganize that com
pany. Both of these deals were carried
through by Drexel, Morgan & Co. Edward
Lauterback gave legal opinion to-day
upon the question whether the sterling loan
made by the Baltimore and Ohio railroad
covered the telegraph system of the com
pany. He decided that the telegraph lines
were free from all liens, and on receiving
this opinion the agreement, in the nature OF
preliminary contract, was executed.
MEMBERS OF THE SYNDICATE.
The parties to the contract are the Balti-
more and Ohio Railroad Company and a
syndicate composed of j. S. Morgan & Co.,
Barring Bros Il Co, and Brown, Shipley
& CO., of London; Drexel, Morgan & Co.,
Kidder, Peabody & Co., and Brown Bros
& Co, of this city, and Drexel & Co, of
Philadelphia. The most important point i'll
the contract provides that the management
of the company shall be placed in compe-
tent hands to the satisfaction of the syndi-
cate. A. J. Cassatt, Vice President of
the Pennsylvania railroad is generally be-
lived to be booked as Mr.. CARROTS success
or. Satisfactory contracts are also to be
made with the Pennsylvania and Reading
railroads on all business north of Philadel-
phia, and with all the other trunk lines en-
tering New York. by which all antagonism
will be removed, and insure permanent
working of the Baltimore aud Ohio in har-
mony with the other trunk lines
ABANDONING THE GOTHAM BRANCH.
In addition to these contracts the line in
process of construction from Philadelphia
to New York will be suspended, and the
work on Staten Island stopped. In consd-
Grafton of these contracts being signed, and
with the control in their hands, the syndi-
! cate agrees to relieve the railroad from its
present embarrassment by providing S10,-
| 100000 with which to take up the floating
debt. This will be represented by 81, 900 900
| in Baltimore and Ohio con-
solidated fives, and S5,000,000 pre-
ferred stock. The floating debt as
it stands amounts to $1,000, 900, mostly in
the shape of certificates of indebtedness,
! scrip and notes OF this amount $4,000, 900
is said to have matured on Sept /, and was
| the chief factor i'll bringing about the pres
ent result. One of the parties to the syndi-
cate says: "All outside enterprises of the
Baltimore and Ohio company will be sold to
parties to whom they will be valuable"
GOULD TO BUY THE TELEGRAPH.
The Western Union will control, if it does
not buy the telegraph lines, and the Pull
man Palace Car Company will take the
sleeping car business. The express business
has already gone to the United States Ex-
press Company. The affairs of the railroad
| company will be entirely reorgenized and
placed upon a sound financial basis. The
| clause of the contract suspending all work
on the extension from Philadelphia to New
York is believed to be the key note
of the syndicate's interest in the negotia-
/ tons, and is construed to mean that the Bal
| timore and Ohio railroad, when Invested of
| all extraneous enterprises, will be operated
practically by the Pennsylvania railroad.
A CIRCULAR ISSUED.
After long conference of capitalists at
| the office of Drexel, Morgan G. Co., the fol
lowing was issued to-day by that firm
| A preliminary contract has been executed
| to-day between the Baltimore and
| Ohio Railroad Company, Barring
Bros. G. Co., and Brown, Shipley
g. Co, London, and their allied
houses on this side. This contract provides
for the negotiation of S., 900, 600 of Baltimore
and Ohio SIS and S5,0O0,0OO of Baltimore
and Ohio preferred stocks for the purpose
| of paying off the entire floating debt of the
company and placing it on sound finan-
| cial basis The conditions are as follows:
| /. Notification of statements, etc., as
made.
2. That the management of the company
shall be placed in competent hands, salts
| factory to the syndicate.
g. That satisfactory contracts shall be
| be made between the Baltimore and Ohio
and other roads for New York business,
which shall remove all antagonismS between
them on the subject and insure permanent
working of the Baltimore and Ohio in en-
tire harmony with other trunk lines, and
also to avoid the construction and threat of
construction of expensive parallel lines
north and east of Philadelphia.
The houses interested on this side are
Drexel, Morgan 81 Co., Drexel q Co.,
Brown Bros. and Kidder, Peabody & Co.